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Where two creeks meet in the San Bernardino National Forest, one is flowing and the other is just a trickle. Nestlé's bottled water operation is undergoing an environmental review.

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The remaining water that Nestle has not harvested from higher elevations flows down Strawberry Creek in the San Bernardino National Forest, October 11, 2017.(Photo: Jay Calderon/The Desert Sun)Buy Photo

In what conservation groups are calling a major win, environmental activists and the U.S. Forest Service have reached a settlement in a legal fight over the permit that allows Nestlé to pipe water out of the San Bernardino National Forest to bottle and sell it.

The settlement, which was finalized Wednesday, stipulates that the Forest Service must within 30 days issue a decision either granting or denying a special-use permit for Nestlé’s operation.

A Desert Sun investigation in 2015 revealed that Nestlé had been piping water out of the mountains under a permit that listed an expiration date of 1988, but which the Forest Service allowed to be used since then, with no review.

Nestlé acquired the operation in 1992, and has been paying $624 per year to the Forest Service for the permit. In 2016, Nestlé piped 32 million gallons of water from its sources in the national forest.

A federal judge ruled in 2016 that Nestlé’s permit was still valid because in 1987 the company's predecessor requested a permit renewal and didn’t receive a response.

One of Nestle's pipelines carries water across the San Bernardino National Forest.(Photo: Jay Calderon/The Desert Sun)

Three environmental groups – the Center for Biological Diversity, the Story of Stuff Project and the Courage Campaign Institute – appealed the lower court’s decision in November 2016. The settlement means the Forest Service will acquiesce to the main argument made by the conservation groups: that the company cannot continue to use its current permit indefinitely, and that the federal agency needs to finish a complete environmental assessment quickly.

Ileene Anderson, a senior scientist with the Center for Biological Diversity, said she’s satisfied with what the Forest Service agreed to.

“They need to have a contemporary permit,” Anderson said. “They’re obligated now to at least go through this process.”

Most importantly, Anderson said, the review and proposal required by the settlement will be made public and include an opportunity for the public to submit their comments.

Ultimately though, Anderson said her organization wants Nestlé out, and she hopes the settlement could be a first step in a process that leads to shutting down the company’s operation.

“What we hope for is that they’ll deny it,” she said.

Nestlé’s Forest Service permit allows the company to use its horizontal wells, pipelines and water collection tunnels in the mountains north of San Bernardino.

The Forest Service announced in 2015 that it would begin a review of the permit, and in 2016 released a proposal to grant the company a new five-year permit.

The issue also prompted several complaints to the State Water Resources Control Board starting in 2015, which led to an investigation by water regulators into the company’s water rights claims.

State officials carried out a 20-month investigation and concluded in December that the company doesn’t seem to have valid rights for much of the water it’s been drawing from the forest north of San Bernardino. But Nestlé disputed the findings, arguing in a written response in February that it has rights to take at least 88 million gallons each year – nearly three times as much as the amount that ran through its pipes in 2016.

As part of the federal review and proposal process, the settlement says “the Forest Service will prepare and complete and environmental impact statement or environmental assessment, or determine that a categorical exclusion applies, pursuant to the National Environmental Policy Act.”

A spokesperson from the Forest Service directed questions to the U.S. Department of Justice, which could not be immediately reached for comment.

Alix Dunn, a spokesperson for Nestlé, said in a written statement, “We look forward to collaborating with the USFS to develop the final Adaptive Management Plan.”

Dunn highlighted the 2016 federal court’s ruling that the existing permit remains in effect. Dunn said the company “vigorously disputes any inappropriate allegation made regarding our permit status.”